Here are some of the examples of the most common questions:

• When it comes to China B2B marketing, what tools are the most effective?
• Is it critical to establish B2B company’s presence on Chinese social media and if so, which platforms are the must have?
• How can companies re-purpose their existing campaigns on traditional Western platforms for Chinese market?

In this post we have attempted to consolidate our answers to those questions in an easily digestible Q&A format.

China B2B Marketing Q&A

Q1: What is the significance of digital marketing in the China B2B (Business-to-Business) market?

Chinese workforce is very well connected digitally, hence reaching it via those channels is an effective way to engage with the decision makers at all company levels. A lot of communication is taking place within WeChat, both on one-to-one basis as well as in the groups. Taping into that space can prove extremely beneficial for brands selling products to other companies.

Q2: Are there any differences between B2B and B2C?

Yes, some digital platforms are less suitable for B2B, however that would also depend on the type of business you are in. B2B sales process is generally longer and involves more than a single decision maker while this is usually not the case for B2C. Since there is practically no impulse buying in B2B, the marketing should focus on stressing product’s benefits and establish trust rather than relying on the emotional appeal.

Q3: Should companies manufacturing and distributing industrial goods invest in digital marketing activities – in general and especially in the Chinese market?

Yes but, perhaps, not to the same extend as B2C companies. Depending on the niche, B2B companies should invest in quality content that can be distributed to the target audience via WeChat or company blog.

On the other hand, digital marketing helps to establish brand reputation which goes a long way in developing trust, a critical component in B2B sales.

Q4: What are the most important instruments of digital marketing in China in relation to industrial goods?

In our experience, the most effective tools for such companies are WeChat official accounts, search engine marketing and email marketing. They can target potential buyers at different levels of the sales funnel and, if done correctly, will complement and leverage each other.

Q5: Should all these instruments be used in parallel or does their use depend on product group and target group?

Depending on the niche, some channels can be more of less effective. It also depends on where the potential customer is in the sales funnel: SEM is best for finding new business while WeChat and EDM are best for getting repeated business and strengthening brand image and reputation.

Q6: What hurdles do B2B companies have to overcome if they want to start digital marketing activities in China to reach their target group?

It is unrealistic to only rely on digital tools to grow business in China B2B marketing context. Direct marketing and trade shows should be used in the combination with online platforms.

Both digital and offline methods should ideally complement each other and be a part of coordinated strategy. For example, a sales person meeting with a client should have that client’s email recorded in the email database that will be later used for targeted email marketing campaign (with their permission of course). At the same time, that same sales person should also encourage a client to follow company’s official WeChat account, so he or she will be included in a more extensive long term WeChat based marketing effort in the future.

Q7: What is your opinion on data protection with regard to the collection of personal data using digital marketing tools?

Chinese are generally less concerned with privacy compared to Westerners but there are relevant laws and regulations that must be followed. Cybersecurity law that was adopted about 1.5 years ago is very detailed and fairly complex. Companies who collect and store personal data must make sure to stay in compliance with the law or face heavy penalties.

Q8: Which digital marketing instruments should be part of a strategy for the Chinese market and why?

The big ones are WeChat, Weibo and search engines like Baidu and 360Search. WeChat presence is a must for most brands, but Weibo is more suitable for brands that have a social element in their marketing approach. Baidu and 360Search are used to target potential customers early on in their search or discovery stages.

Q9: Is there a need for a different digital marketing strategy for the Chinese market than, for example, for the European or American market?

There is no direct equivalent to WeChat in the Western markets, and there are no direct parallels with Twitter or Facebook in China. Each Chinese platform is a combination of some of those features. Therefore, copy and paste of Facebook/Twitter marketing to those channels would probably not work.

Brands should familiarize themselves with pros and cons of each platform and adjust their strategies accordingly. For example, the requirements for content size, style and formatting are different among those services and may be suitable for different purposes.

Q10: What approach do you recommend to newcomers to creating a digital marketing strategy in B2B for the Chinese market?

Newcomers should start off investing in SEM and WeChat marketing in combination with traditional direct marketing which is aimed at building networks of business contacts at traditional offline events such as trade shows.

If a foreign company is at the beginning of their journey in Chinese market, they will be better advised to outsource such efforts to professionals.

Q11: How important are defining the target group, analysis and selection of suitable measures and instruments for the creation of a suitable digital marketing strategy?

B2B companies usually have a good idea of who their customers are and what they are interested in. Therefore, detailed definition of target audience like it is common in B2C (psychographics, behaviors, interests etc.) is often less relevant when applied to China B2B marketing context.

Q12: Where do you see opportunities but also risks here?

Prevalence of digital tools in China presents a unique opportunity to have a direct access to customers and engage them on a constant and intimate basis as long as the company can offer good value with their content.

The risk is mainly over-reliance on digital tools neglecting traditional “offline” methods that are still the most effective in building business networks and develop brand trust in China B2B marketing environment.

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As of now, China’s e-commerce sector is more than three times the size of the US market, which currently ranks distant second.

China has has been the largest ecommerce economy in the world since 2015. In 2019, it reached 1.94 trillion USD, representing an addition of 27% year over year and a quarter of China’s total retail sales volume.

Currently, the majority of Chinese are online shoppers which representing about 60% of China’s internet user base. When we compare this figure to US, where 88% of internet users shop online, it is evident why China still has plenty of room to grow in absolute terms. Needless to say, that the sooner your company taps into this vast market, the better off it will be.

Now, to the more practical aspect of China’s ecommerce. Generally speaking, there are two choices of selling online: opening a virtual store in one of the large online stores, or setting up your own internet store as an extension of your main website or as a stand alone site.

Plugging into China’s existing ecommerce ecosystem

The largest C2C ecommerce site in China is Taobao.com which as an equivalent to Ebay. Although, it is an entire universe in and of itself, selling on Taobao is more suitable to small retailers or individuals. It is a very competitive space and is notorious for fakes and pirated stuff. If your goal is building a trustworthy brand image you should stay away from Taobao.

Luckily, there is an alternative from the same Alibaba group that owns Taobao, called Tmall. The company goes to great extend to make sure that the product sold on Tmall are genuine. Sellers on that site have to abide by strict procedures which are even tougher for overseas companies. Read our earlier post for more details on how to establish a Tmall store and whether it’s a good fit for you.

While Tmall holds about 50% of B2C ecommerce market in China, Jingdong Mall (JD.com) is the second in size at about 22% market share as of 2013. The idea is similar to Tmall – Jingdong Mall is for branded products only and you will be expected to prove that you either own the brand or are authorized to sell it.
There are a few more such “online shopping malls” in China: Suning that focuses mostly on electronics and Amazon.cn – scaled down Chinese version of Amazon.com.

The pros of working with the existing ecommerce site can be summarized as follows:

• Traffic that goes through those sites is enormous and you are almost guaranteed to get some of it;
• Setup is not very complex, although it could be a bit tricky for a non-Chinese company. If everything is done right, your store can be up and running within 2-3 weeks;
• You can also benefit from marketing programs within the platform, although it would cost extra;

Of course, there are some cons too:

• It isn’t cheap. There are setup and running costs and a deposit, in case you are found in violation of the terms of the agreement (by selling counterfeited products for example). I discuss the cost of setting up Tmall store in more details here;
• Fierce competition from other sellers, pretty much like what you have in a traditional brick and mortar shopping mall but with more ads from every direction;
• Limited opportunity for differentiation by expressing your unique style or brand experience;

Setting up a stand alone online store

If you have a technical expertise to setup your own functional internet store than this could be an alternative route for your Chinese ecommerce strategy.

The obvious advantages of that approach are:

• You are in full control of your own store as there is no need to comply with anyone’s policies;
• Your store can provide a unique brand experience for a shopper that may not be available in Tmall or JD.com;
• There is no commissions on your sales to a 3rd party and no maintenance fees;

Disadvantages of building your own store could be as follows:

• You don’t benefit from the online mall’s traffic and acquiring it through marketing campaigns may become more expensive than paying to Tmall or JD.com for their marketing programs;
• Building your customers’ trust takes time. In the existing online mall like Tmall, trust level is high – shoppers know what to expect, fairly familiar with how it works and are quite sure that they’ll get what they pay for (and if they don’t there is proven recourse). Your customers have to be just as confident that they won’t be ripped off;
• The technical challenges can be substantial: you have to have the right payment system such as Alipay, Tenpay or Baidu wallet setup; take care of all the technical challenges related to traffic and transactions; having live support through chat; manage inventories; get a delivery system in place, just to mention a few.

As most of the examples show, and considering your marketing budget allows that, the best strategy is the combination of both approaches. Setting up Tmall or JD store for building brand recognition and attracting new customers in addition to having your own internet store for more immersive brand experience targeted at existing customers and brand followers.

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If you are selling a physical product, one of the best ways to find out what is already available is to research Taobao (Taobao.com), the primary C2C marketplace in China and its B2C equivalent, Tmall (tmall.com). Both platform belong to Alibaba and are similar to Amazon but much bigger.

Chinese Marketplace Sites Search

As mentioned before, none of Taobao or Tmall results will appear in Baidu searches, this is why it is important to research this channel separately.

While typing the search term (“sunglasses” in our example), more results will be shown as you type in, giving some insights on what other terms are frequently searched for (of course, you need to understand Chinese to make sense of it):

Additional search terms may give some more clues on what else you should be researching.

Taobao will also display a multilevel filters allowing for more targeted searches. In case of “sunglasses”, the results can be filtered by glasses shapes (oval, round, square, aviator, rectangular etc.), lens color, suitability for different type of face, gender and so on as well as price range.

The results, each with an attractive product photo, short description and the price, will be displayed right below the filters:

Typically, most results will be linking to either Tmall (like in the case of fashion items) or Taobao itself. Tmall is a type of an upscale version of Taobao with a strict policy against fakes. In the physical world, Tmall can compared to a branded department while Taobao is more of a bazaar style market.

How Taobao can help with the market research? First of all, it is the best to research product prices and price ranges for different subcategories of products.

Secondly, you will be able to better understand the overall popularity of the product category, competition and sales channels.
Finally, seeing so many competing offers grouped together may give you more insight on how yours could fit in the mix.
Side note: occasionally, you may even find your own products sold by someone else that you may not be aware of.

Stay tuned for the upcoming post on how to perform basic market research with Chinese social media.

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Singles day is an informal shopping festival in China that has originally celebrated people who are still single. It falls on 11/11 which is meant to symbolize people who are not in a relationship. Since it started back in 2009, it has become the largest shopping event in China, akin Black Friday or Cyber Monday in North America, although much bigger.

Originally, the event was started by Alibaba which began offering discounts on its main shopping platforms, Taobao and Tmall, that lasted for 24 hours. The festival was picked up by other Chinese e-commerce sites like JD.com and now, increasingly, by traditional brick-and-mortar stores. Most of the action still goes online via e-commerce sites and mobile apps.

Every year, the festival kept getting bigger but this year, there were concerns that  it might actually slow down a bit. The main worry was that slowing Chinese economy and the trade war with US would dampen shoppers’ enthusiasm.

“It is possible that there will be a slowdown in growth for Singles Day sales, given that they have had exponential growth in the past,” Xiaofeng Wang, an analyst with Forrester, said before the event.

This did not happen. In fact, 2018 Singles Day raked a whopping $30 billion in the first 24 hours, beating the last year record of $24.2 billion.

Here is the latest data compiled by Statista:

Similar North American events are dwarfed by China’s 2018 Singles Day – the sales on Thanksgiving Day combined with Black Friday are about 5 times smaller.

Attempting to capitalize on seemingly insatiable appetite of Chinese shoppers for foreign products, the event was picked up by platforms outside of China. A recent survey from research firm Oliver Wyman found that 57% of China’s online shoppers consumers were planning to buy goods from overseas during 2018 Singles Day. The top countries that were most popular with the consumers are Japan, USA and Australia.

In addition, Alibaba’s South East Asia subsidiary, Lazada, was offering Singles Day discounts in Singapore, Malaysia, Indonesia, Thailand and Vietnam.

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Presently, ecommerce with WeChat can only be setup for verified service accounts which, in turn, requires local business registration. So, as things stand now, foreign companies without a legal presence in China are not eligible to have a WeChat store. However, once the company is registered locally in China, setting up ecommerce with WeChat is, actually, a fairly simple process.

There are basically two ways to integrate a WeChat shop within a service account: by signing up for a standard option within admin platform or setting it up with a 3rd party platform. The second way allows much more customization allowing creation of much more versatile and visually appealing WeChat stores.

One of the most popular 3rd platforms is WeiDian. It already claims a whopping 50 million users and is backed by Tencent, WeChat developer. It also provides a convenient backend for managing WeChat store: populating product list, managing inventory, CRM system, sales analytics etc. All that can be done from within the app on a phone or inside the browser based admin panel.

As a way of marketing, WeiDian also allows sharing product listings in group chat and Moments feed as well as in other social media platforms such as Weibo, QQ, Qzone, Pinterest and even Facebook.

Although being the most popular, WeiDian is not the only WeChat shop management platform. Other 3rd party WeChat store options are Youzan, MengDian, PaiPai and some others. All of them are quite similar in functionality, although none is currently offering English language option or support.

Although, there are many options for setting up a WeChat shop, it may not be suitable for every category of merchandise. Naturally, since the shopping is done on mobile, customers tend ti use their phone for buying cheaper products. When it comes to big ticket items or products that require a research, most shoppers revert to full size browsers which brings them to traditional platforms such Tmall, Taobao and JingDong.

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There are several reasons for this trend:

1. First is the natural growth of businesses is driving the demand for office supplies. More offices, big or small, are being opened, existing offices expanded or moved to larger facilities;
2. Then there is a drive to save cost. Buying online allows making purchases fast and efficient. Products and brands can be easily researched and prices compared finding the best value;
3. Finally, proliferation of Chinese ecommerce and general public’s familiarity with it, is making the transition and acceptance of online procurement a more natural process;

Chinese B2B Ecommerce figures

As noted by China Internet Watch, enterprise online purchases have been growing particularly fast since 2010 when the government first introduced new policies to support ecommerce and e-businesses. As the trend continues, it is predicted that Chinese B2B ecommerce market will increase at the annual growth rate of 30% for the next 3 years.

Another interesting fact is that, as of H1 2015,  Jingdong (JD.com) holds the largest market share (39.4%) in this particular segment of Chinese ecommerce. It is followed by Alibaba with 18.1% and Suning at 10.9%. The rest is shared between Amazon China, Gome, Yihaodian, Dangdang and others.

This also shows that Jingdong has definitely been on the rise in 2015, taking even larger share of ecommerce away from Alibaba. They are focusing on their traditional strong areas such as appliances and electronics which, incidentally, are the products that businesses tend to purchase.

According to H1 2015 statistics, computers accounted for almost 40% of all online purchases in Chinese B2B ecommerce segment, followed by basic office supplies at 22.7%, mobile communication devices (16.5%) and other digital products such as electronic appliances and networking equipment (7.7% and 3.4% respectively).

This means that if your company is selling products in any of the above categories, Jingdong could be one of the sales channels to consider setting up. Targeting businesses through advertising within Jingdong is another element that should be incorporated with the overall B2B marketing strategy. Such ads should be tailored specifically to speak to the needs of office based businesses, stressing the overall utility, better service and cost savings.

The post Chinese B2B Ecommerce: Selling to Businesses Online first appeared on Sampi.co.

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We will cover various pros and cons of JD vs. Tmall in upcoming articles. Today’s post will feature the latest infographic by Go-Globe that visually shows what JD is all about.

JD prominence in China’s ecommerce market is bound to grow due to several reason. First one is JD’s recent partnership with Tencent, the company behind WeChat. This would add a powerful mobile component to JD market strategy.

Second reason is that the most popular search engine in China, Baidu, is also cooperating with JD. As a result, due to this partnership on one hand, and the ongoing war with Alibaba on the other, only JD links are displayed in Baidu search results. This provides another powerful source of traffic and makes selling on JD a very attractive opportunity.

Here the full infographic:

Selling on JD – platform overview

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This giant virtual shopping mall has become a staple of modern Chinese culture, a place where one can find practically anything and have it delivered straight to the door in just a day or two.

Taobao has also enabled millions of people in China to supplement their income by selling goods online. Large percentage of those sellers were even able to leave their day jobs to focus entirely on running their online outlets.

Presently, western brands in China primarily sell their products on another Alibaba’s shopping platform called Tmall. Although, similar to Taobao, it is a sort of upscale department store, as opposed to bazaar-style Taobao market. Tmall has been designed to attract buyers who are looking for genuine branded products and are prepared to pay premium for top quality. 

Unfortunately, start up cost of opening a Tmall store range somewhere in the range of RMB 150-200K and are further complicated by complex and strict requirements by Alibaba to ensure that only quality products are sold there. Penalties for breaching the rules can be substantial and costs of running and maintaining such stores could be prohibitive for smaller retailers or those without a recognizable brand name.

So, for those type of sellers, Taobao represents an easier option that doesn’t require a major investment while allowing to test waters with specific products and offers.

Here are twelve tips on how to make sure that the goods your Taobao store is selling get noticed, product links get clicked and, ultimately, your visitors convert to customers.

#1: Product title

Since the products are searched by their names, this is by far the most important part of the listing. The product name should pack as much content as possible and even though, the long product name may look awkward, if part of it matches the search criteria, it will get shown. So, longer descriptive name are always preferable to short ones.

#2: Product description

The second criteria that is used in Taobao searches is product description and it is what the shoppers would see when they click on the product link. As opposed to the long descriptive product titles, description should be kept short and “scannable”. Once a visitor is already on the product page, the goal of the description is to keep them interested and have them staying on the page as long as possible.

#3: Product photo

We live in a visual world and shoppers are constantly bombarded with imagery from every angle. The key of making your product stand out is the thumbnail picture of it placed in the listing. Pictures designed to attract attention should be sharp, focus on the entire product or its main feature and be of high contrast. It’s always the best strategy to critically assess your product photos vs. competitive offers and simply make sure that yours are better.

#4: Product page

Product pages in Taobao are often long, packed with lots of text and additional pictures which is actually a good strategy. Interested visitor will keep scrolling to read more, and, once enough information is obtained, can buy it right away. The last thing you want to do is provide insufficient information to a potential buyer.

#5: Feature authenticity

One of the main concerns of Taobao shoppers is to avoid getting scammed by buying a product that is fake or of poor quality. The best way to alleviate such concerns is to provide proof of genuine origins of the goods that you are selling by displaying clear pictures of the original packaging, shipping documents, relevant certificates etc. Those can simply be photographed or scanned and shown in the product page.

#6: Customer service

Responding to customer inquiries and answering questions quickly is critical in getting interested buyers to convert as soon as possible. Most effective sellers are able to answer questions almost instantly via live chat which would be the best way to communicate. It quickly builds trust increasing overall sales success rate.

#7: Research keywords

One of the best ways to design the optimal product titles is to research relevant keywords. Taobao provides keyword research tool that can also be used to figure out search volume for a particular product. This information, in turn, allows sellers to design the most attractive offers and focus on products with the best combination of strong demand and limited supply.

#8: Research visitors data

Taobao’s seller back-end provides various analytics on visitors, which primarily focuses on where they are browsing from, which platform they use (desktop vs. mobile) and what products they have viewed. This data can be invaluable in tweaking the product pages to match the tastes and preferences of a specific type of visitor.

#9: Learn visitors behavior

Behavioral patterns can also provide valuable insights on why some products sell better while others do not. For example, if a particular page has many views but few sales, it could be because of the pricing. On the other hand, product pages that don’t get a lot of clicks could be improved by adjusting some visuals;

#10: Test on mobile

Majority of Taobao buyers nowadays use their cellphones to browse and shop. This means that it’s crucial for your page to load quickly and render properly on Taobao mobile app or mobile browser. You should test your product pages with mobile to make sure that they still look attractive on mobile screen and can be navigated just as easily as on a computer;

#11: Add WeChat account

One of the best ways to keep your customers returning is to encourage them to connect to your WeChat official account (provided you have one) by placing its QR code right in your product page. This will allow you to push regular messages with new offers, coupons or  bits of useful information directly to your customers’ phones.

#12: Cross market via alternative channels

Learning about your visitors and buyers from Taobao analytics has an added benefit of leveraging this data towards your other marketing campaigns, such as in social media or mobile. For example, if you see that you are getting many visitors from a particular area, you could target them with location-specific offers via WeChat or Weibo.

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Apart from the obvious fact of continued growth of online commerce in China, a few facts from this presentation could be quite insightful. The first point, that I find particularly interesting, is the fact that 28% of online shoppers turn to online shoppers to find a unique item, perhaps not available or easily found in brick-and-mortar equivalents. This number rises to 41% for people below 25. It means that there is an opportunity for further differentiation of online stores that could take advantage of this trend.

The part on major concerns of online shoppers could also provide an insight on how to improve the experience and make the online shopping process more efficient. Apparently, trust issues, such as the product’s authenticity, is still major issue for nearly 80% of the users.

Other figures, that deserve closer look, are about online travel booking being the fastest growing sector of ecommerce in China as well as the fact that almost a third of all online purchases is made via mobile devices.

Here is the entire infographic:

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While offline, cash is still the king, online ecommerce is ruled by giants like Alibaba’s and Tencent.

 Alibaba was the first to introduce its hugely popular Alipay system that today accounts for about 50% of all online transactions. Alipay is the system used for buying products at the most popular online shopping site Taobao as well as Tmall and many others. Vast majority of Chinese online shoppers are intimately familiar with the system and, most importantly, have learned to trust it.

The second most popular online payment system is Tenpay by Tencent. Tenpay was estimated to hold about 20% of the market share but thanks to the popularity of Tencent’s WeChat platform, Tenpay is projected to grow beyond that. Tenpay can be used to pay for the services integrated with WeChat as well as for purchases from Tencent’s online store.

In April this year, search engine giant Baidu has announced its own online payment system called Baidu Wallet. The company said that it will focus on mobile payments and the service will be integrated with other Baidu platforms and its 14 apps. Baidu claims to have 600 million users which should set it off a good start.

Just like Alibaba and Tencent, Baidu has both payment and financing license which will enable it to offer similar types of services. It is expected that alternative investment and e-financing services currently being offered by Baidu’s rivals will be coming up too.

Until Baidu Wallet is fully developed and has gained large user base, from a perspective of an out-of-China based company looking to sell online to the Chinese, there are currently two options for online payment integration: Alipay and Tenpay. Both services allow cross border transactions and provide a code for web developers to integrate the system  into a website. Once integrated, an online visitor will be able to pay for purchases directly with his/her Alipay or Tenpay account in RMB. Once the transactions is completed, the funds will be exchanged at the same day’s rate and wired to merchant’s overseas account (minus the commissions). Alipay currently supports 12 different currencies and also offers a mobile payment option.

In order to apply for either Alipay or Tenpay, the merchant has to provide a copy of a business license from the home country, passport scans of the owners and filled out application form. The application is then verified and processed which takes about 1 month. Once the application is successful, the agreement is signed and the instructions on technical integration are provided.

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